Long-time readers know that I have frequently commented on this site on the phenomenon of “event-driven” litigation (for example, here). These are securities lawsuits filed in the wake of a significant operational event or development that disrupts a company and tanks its share price, as opposed to securities suits that are premised on accounting or financial misrepresentations. I am far from the only observer that has commented on this phenomenon. Among others, the Bloomberg columnist Matt Levine, in an article provocatively entitled, “Everything Everywhere is Securities Fraud” (here) also weighed in on the event-driven litigation trend.
There are, of course, usually two sides to every story, and in a April 5, 2023 Law360 article entitled “Why Event-Driven Securities Class Actions Often Succeed” (here, subscription required), David Barenbaum and Michael Dark of the Berman Tobacco firm provide a plaintiffs’ side view of event-driven securities litigation, and make out their case that these cases are not only not frivolous but provide securities investors important remedies and protections.
Source: Are Event-Driven Cases More Often “Frivolous” or “Successful”? | The D&O Diary